When More is Less: Higher Oil and Gas Taxes Harm Alaska

December 6, 2017

There is a complicated relationship between the energy industry and regulators in Alaska’s economy. Still recovering from the recession, many state legislators supported measures that raise taxes on energy suppliers, rather than fostering growth in the domestic economy. Adding to the legal uncertainty, there have already been seven major regulatory changes in just the last 12 years.

Higher taxes on the oil and gas industry will not yield the right answers. Raising taxes on an industry that has repeatedly demonstrated its commitment to Alaska, but yet is buffeted by low commodity prices and global economic pressures, will have the effect of a downward spiral and will chase exploration and production to other parts of the U.S and the world. More taxes on a declining body of revenue will simply push off the day when Alaska’s budget woes are repaired in sustainable manner.